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Cumulative Power Sector Investment by Region, 2005-2030

There is an international dimension of capital flows to lowcarbon
technologies. Investing in key emerging economies such
as Brazil, Russia, India and China, the so-called BRIC countries,
requires navigating complexities specific to each country. This
includes understanding the network of investment players that
can support large-scale deployment of technology. For instance,
utility scale project finance in China involves a different set of
players than venture backed financing of a PV company based
in Silicon Valley.

Understanding the distribution of financing is important
because different countries draw on very different sources of capital.
In China, for instance, the vast majority of capital deployed
in the energy sector is domestic, and less constrained by ROI
requirements than in more liberalized markets. According to
the World Energy Outlook the largest investment requirements
in the power sector, some $3 trillion, will occur in China by
2030.

While the majority of capital invested in BRIC countries is
from domestic sources, the sovereign risk characteristics of these
countries can differ significantly, which can influence the types
of international lenders willing to invest in these markets. Investor risk tolerances, combined with the capacity of a country
to absorb and deploy technologies, and the local policies and
measures influence which technologies will influence investment
capital in the BRIC countries.